EDMONTON04110 - Business Revitalization Zones

Business Revitalization Zone Area Review

July12, 2005


Office of the City Auditor

EDMONTON04110 - Business Revitalization Zones

Business Revitalization Zone Area Review

1.Introduction

The Office of the City Auditor’s (OCA) Annual Work Plan included the Business Revitalization Zone (BRZ) area review project. The OCA’s goal throughout this review was to provide a proactive and forward-looking focus to help bring about performance and overall effectivenessimprovements in the BRZ program.

2.Background

The Province of Alberta passed legislation in June 1983 which permitted municipal governments, at the request of a business community, to establish a Business Revitalization Zone.

A BRZ is a non-profit association of business owners that join together to promote and improve the economic vitality of their business district. BRZs provide unique opportunities for businesses to accomplish mutual goals. Customers want safe, interesting, and attractive places to dine and conduct business. To attract these customers, a BRZ can be used to enhance streetscape improvements, carry out joint promotions and festivals, and promote economic development initiatives.

The City assists by helping merchants and landlords form BRZs. Once a BRZ is formed, it is managed by a volunteer board of directors comprised of property owners and tenants. BRZ funds are used to hire staff and implement BRZ plans. The City’s role is to assist with contacts between the BRZ and City departments, facilitate the annual funding process, and monitor BRZ budgets. The Planning and Development Department – Strategic Services section provides consultative and planning services and prepares BRZ reports and bylaws for Council consideration.

A BRZ organization receives funding through a special levy added to each business tax assessment within the BRZ area. Each year, members of the BRZ approve its budget at an annual general meeting. The budget is then submitted to City Council for approval as required by legislation. Following Council approval of the budget, a special levy sufficient to raise the approved budget amount is approved and added to the Municipal Business Tax for all businesses within the BRZ area. This special levy is collected by the City through the normal business tax billings process and the full budget amount is turned over to the BRZ through quarterly payments. Each business owner’s share of the annual BRZ budget is proportionate to their share of the total taxable value within the BRZ boundaries.

Worldwide, there are approximately 1200 Business Improvement Areas or like Business Improvement areas, of which, approximately 348 are in Canada and 429 in United States.

3.History

There arecurrently ten Business Revitalization Zone Areas in the City of Edmonton representing approximately 3800 businesses. Following is a brief history and background of each of those areas:

Alberta Avenue Business Association (AABA)

The AABA BRZ established in 1995 represents the businesses along 118th Avenue from the underpass at Northlands to 105 Street, north of NAIT. It is bordered by five Community Leagues with a population over 30,000. It represents over 180 businesses and services located within the BRZ boundaries, a high proportion of these businesses are family operations or single proprietorships that cater to the needs of the community.

Alberta Avenue is a historic commercial and social centre to the neighboring communities and City of Edmonton. The businesses reflect the areas unique ethnic diversity and community dynamics.

Beverly Business Association (BBA)

In September 12, 1995, the Beverly Business Revitalization Zone was established, with a mandate of advocating the long-term economic viability of the area. The BRZ encompasses approximately 150 businesses on 118th Avenue between Abbottsfield Road and 51st Street. To this end, the Beverly Business Association has developed a long-term plan for the revitalization of business activity on 118th Avenue between 32 and 51 Streets. This plan includes the development of a western frontier theme for promotional purposes, streetscape improvements along the Avenue, and a number of initiatives designed to encourage businesses to locate in BeverlyTowne.

Downtown Business Association (DBA)

The Downtown Business Association (DBA) was established in 1985 and includes an area from 111 Street to 95 Street and from 105 Avenue to 97 Avenue; this association encompasses approximately 1,800 businesses. The DBA exists to effectively market the downtown and represent the interests of its members as they relate to the economic, political and social viability of the downtown business district. The DBA facilitates dialogue and partnerships among key stakeholders and conducts special events and activities to promote the downtown.

The Association’s volunteer Board plays an active role in the governance of the operations, marketing, economic stability and development, infrastructure, safety and parking issues.

The DBA partners with external committees such as Edmonton Economic Development Corporation, Alberta Economic Development, Edmonton Chamber of Commerce, Urban Design Review Panel, Art and Design in Public Places, Downtown Advisory Committee, the Arts District and all City departments.

Fort Road Business Association (FRBA)

The Fort Road Business Association (FRBA) was established in 1991 by local businesses along Fort Road from the CN tracks to 137thAvenue. Between 1991 and 1998 the FRBA had some success in carrying out initiatives. In 1993 a master plan for the Fort Road was prepared and funded by the FRBA. The plan focused on economic and business development with some physical improvements, education programs, and marketing initiatives. In 1998/1999 the association ceased operation. In 2000 the Business Association began with renewed enthusiasm with approximately 100 business members. The Association completed a three-year business plan focusing on a new vision and plan for the Old Towne. In 2001,the Fort Road Old Towne Plan was initiated. The Fort Road Old Towne Master Plan is a City-led initiative to create a new transit-oriented urban village next to the Belvedere LRT station as a means to revitalize a historically vibrant business community.

Inglewood Business Association (IBA)

Inglewood is a small district that has seen substantial growth in the past couple of years. The Inglewood Business Association was established in 1995. The area is located between 122Street and 129 Street along 118 Avenue and runs between 118 Avenue and 111 Avenue along 124 Street.There are approximately 66 businesses that are members of this association and are mainly owner operated. The recent move of St. John’s ambulance to the business area has had a positive impact.

Kingsway Business Association (KBA)

The Kingsway Business Association (KBA) has been established in Edmontonsince 1989. The membership consists of approximately 350 business members. KBA is a unique business area with a mix of publicly and privately owned properties, which require partnerships and participation from a number of stakeholders, including the City of Edmonton, Province of Alberta, Federal Government, Edmonton Public School Board and Capital Health, in order to achieve their goals. The continued support of the CityCentreAirport is always at the forefront with the KBA.

Old Strathcona Business Association (OSBA)

The Whyte Avenue Commercial Area began to develop in the late 1800’s as the main commercial thoroughfare in the town site of Strathcona. After Strathcona was incorporated into the City of Edmonton in 1912, the Whyte Avenue Commercial Area continued to be recognized as a major commercial centre. Over the years, the commercial area has undergone a number of changes. In the 1970’s, this commercial area had a reputation for being rundown and seedy. In the 1980’s, trendy shopping facilities started moving into the area and increased the interest of property owners, residents and interest groups in rehabilitating the commercial area.

The Old Strathcona Area Redevelopment Plan (ARP) was undertaken by the community of Strathcona in consultation with the City of Edmonton, and approved by City Council in September, 1981. By the mid-1980’s, property owners had expressed their commitment to the future of this commercial area by funding streetscape improvements which would set the trend for commercial area streetscape improvement programs for years to come. This commitment led to the establishment of the Old Strathcona Business Association in 1983. The OSBA represents over 500 businesses in the area. In addition, business owners began working with property owners to improve building and property conditions.

In the 1990’s, the Whyte Avenue Commercial Area was deemed a success. Business and property owners, residents, interest groups began to reap the rewards of their hard work in making this area a special and unique commercial experience in Edmonton. With the increase in people visiting, working, living and opening businesses in the area, the entertainment and service industries moved into the area in increasing numbers. The increase in popularityresulted in increased traffic, parking, and pedestrian congestion, and further pressure for more change and redevelopment. The Community went through a three-year process to develop the new Area Redevelopment Plan (ARP) that was adopted by City Council in December 1998. The Old Strathcona Business Association works closely with City Council and the community to combine resources and to continue to restore the community. Important issues are development, maintenance of infrastructure and streetscape, and safety.

97 Street and Area Business Association

This BRZ was established in 2000 and represents approximately 234 businesses in the areathat covers 105 Avenue and 110 Avenue from 95 to 101 Street. The BRZ continues to concentrate on economic development and job growth and in retaining businesses that are at risk of leaving the business area. The Business Association acts as the operating mechanism for funding programs. The Association is working on an ongoing basis to monitor and conductyear round street maintenance and beautification. The BRZ has focused increasedattention on street maintenance and security, retail recruitment and retention, parking and transportation issues.

124 Street and Area Business Association

In 1986, the merchants of the business district located along124th Street betweenJasper Avenue to 111 Avenue in central Edmonton formed the 124 Street and Area Business Association. The purpose of this association was to work with the City of Edmonton to stimulate growth within the business district. Through the efforts of many members working with the Board over the years, 124th Street has physically improved with streetscaping and infrastructure work. Many businesses have seen the benefits of locating or expanding within the 124th Street business area and the vacancy rate remains at an all time low.

The business association currently represents approximately 300 businesses in the area. Many of the businesses have been on 124th Street for years, providing specialty sales and service to Edmonton and surrounding areas. With easy access to 124th Street, the area has become a natural business district for specialty shops, professional services, fine restaurants, bistros and the well-known“Gallery Walk.”

Northwest Industrial Business Association

The Northwest Industrial Business Association was incorporated in December 2001, located in thearea West of 170 Street and north of 109 Avenue. The members are primarily larger industrial businesses, generally occupying large lots or large multi tenant buildings. There is a mix of locally owned, national and international business operations. Manufacturing, distribution and industrial sales make up the majority of the 120 members within this BRZ. Efficient transportation access and egress is a priority issue for the area.

4.Objectives

The general objective of this review was to assess the effectiveness of the overall BRZprogram framework within the City. City policy C462A, Establishment & Operation of Business Revitalization Zones in Edmonton and the Municipal Government Act, Business Revitalization Alberta Regulation 377/1994 are designed to supportthe BRZ program framework and to guide BRZs efforts in achieving their objectives. In addition, the Terms of Reference for this project was submitted to the Councilors for feed back.Input was received and incorporated in the audit objectives.

Specific objectives of this review included the following:

  • To Identify and assess the issues, risks, challenges, and opportunities impacting BRZsin the achievement of their objectives.
  • To review and report on the BRZs’ annual activities and accomplishments, business taxes assessed and taxes collected for each BRZ area and funding assessment breakdown towards BRZ programs.
  • To review the governance roles, responsibilities, and relationships of BRZ Areas and City departments as they relate to the BRZ process in Edmonton and toassess whether existing BRZ legislation, policy and bylaw information guide BRZ efforts in achieving the objectives and are established and communicated accordingly.
  • To determine if other jurisdictions have Business improvement or revitalization areas and to provide any learnings gained from the administration practices in place.

5.Methodology

This evaluation was conducted within the context of the BRZ mandate provided by provincial legislation, City Policies, Administrative Directives and any related procedures. The OCA undertook the following work to support the audit objectives:

  • Conducted interviews with City representatives fromPlanning and Development Department - Strategic Services section,Transportation and Streets, Corporate Finance, Office of the City Clerk, Old Strathcona Integrated Services Team, and Tax Assessment.
  • Conducted interviews with all ten Business Area Executivesto obtain first-hand insight into the opportunities, challenges, risks facing BRZs in the city and the benefits of BRZs to a municipality.
  • Participated in tours of all ten BRZ areas. The OCA also attended and observed the process involved in the Old Fort Towne Road Master Plan visioning session.
  • Conducted both telephone and personal interviews with business owners, BRZ board members, and attended BRZ board meetings.
  • Submitted the project Terms of Reference to City Council for input and feedback.
  • Consulted with external individuals with expertise in Business Improvement Areamanagement, EEDC and had discussions with other municipalities on this topic.
  • Reviewed City Council meeting minutes and agendas for the time period of 2000 to 2005 to acquire a familiarization of issues being brought forward by the various BRZs.
  • Reviewed relevant legislation such as the Municipal Government Act – Business Revitalization Zone Regulation 377/1994 and City Policy C462A, Establishment and Operation of Business Revitalization Zonesand the respective City Bylaw (previous Bylaw 9747) that relates to each BRZ in Edmonton.
  • Reviewed literature from across Canada and the United States that was obtained from the internet, Planning and Development library, and BRZ Executive Directors to understand legislation from other Business Improvement areas across North Americaand best practices used by other municipalities.
  • Compiled and analyzed annual reports detailing accomplishments, revenues and expenses for all Edmonton BRZs.
  • Conducted asite visit with Planning and Policy Branch Strategic Services representatives as they explored the possibility of future BRZ expansion of existing and new areas.

6.Observations and Analysis

This section of the report describes the work completed throughout the audit. It is organized into the following general categories: Challenges, Opportunities and Risks; BRZ Activities and Accomplishments; Existing Support and Governance; Benefits and Expansion; and Other Jurisdictions.

6.1.Challenges, Opportunities and Risks

The OCA developed a questionnaire that asked key questions relating to challenges, opportunities and risks that are and could be encountered by BRZ business associations and city representatives involved with the BRZ process. The questions asked during the interviewsfocused onthe BRZ purpose and objectives, governance processes, legislation, polices and plans, management processes, risk identification, strategic planning, and performance targets that promote service direction.

The results identified from the consolidated analysis indicate the following points as some of the key challenges, opportunities and risks impacting BRZs:

Some of the keyChallengesidentified were as follows:

  • Providing and obtaining business information required by BRZ management in performing program service delivery effectively.
  • Tracking of businesses within the BRZ along with obtaining information on new businesses setting up in the BRZ area.
  • Development of strategic planning for all BRZs.
  • Currently there are ten BRZs in the City of Edmonton. Edmontonappearsto have the most established BRZ programin Alberta. There is a definite opportunity and need to establish a strategic plan to address global vision and priorities for allBRZs, ongoing revitalization, and expansion of existing and new BRZs. The infrastructure and maintenance challenges and initiatives in all BRZs need to be identified and prioritized to provide future direction.
  • Dealing with the diversity of industry issues relative to hours of operation,e.g., twenty-four hours a day versus day time only.
  • Need to obtain standardized information from the City such as:
  • Consistency in economic information by BRZ;
  • Total assessment for the area, composition of area changes, infrastructure and maintenance of high use area;
  • People and traffic congestion statistics.
  • BRZsare volunteer organizations with no consistent formalized structure among the BRZs. The managing executive director is either contract, salaried or part-time. The number of members on the Board varies among each BRZ, each Board consistsof mainly business owners located in the BRZ and availability is limited.
  • Difficult to demonstrate the economic impact of BRZ activities, such as advertising and to measure performance.
  • Legislation has not been updated since the 1980’s. There is some opportunity to review legislation and make changes.
  • Determining the costs associated with providing local government services to BRZs is challenging.
  • Streetscape improvement projects which have completed their lifecycle of 20 years or more now require rehabilitation and renewal. However, a lifecycle costing program to fund current replacement is not available to replace or renew these projects.

Some of the keyOpportunitiesidentified were as follows: